‘Hopelessness, Desperation’ Growing Among Canadians as Cost of Living Rises: Poverty Council

People cross the intersection at Spadina Ave and Dundas Street in Toronto on Aug. 17, 2023. Canada's GDP per capita contracted by 4.4 percent during the third quarter of 2023, says a report by National Bank Financial. The Canadian Press/Nathan Denette

The rising price of food and housing is causing a sense of “hopelessness” among Canadians, according to a new report from the National Advisory Council on Poverty.

The report, which last week was presented to Parliament, said many households are struggling due to the rising cost of living and inflation.

“We noted a growing sense of hopelessness and desperation,” said the study, which was first reported on by Blacklock’s Reporter. “More people are in crisis and these crises are more visible in our communities. Many communities lack stable employment opportunities, decent and affordable housing, food, child care, transportation, health care, and other necessary infrastructure for individuals to thrive.”

Poverty rates dipped to 6.4 percent in 2020, but the Council predicted 2024 figures will put the rate at 9.8 percent representing roughly four million Canadians.

The report’s tabling follows a Nov. 28 briefing note by the Department of Social Development that said inflation was driving more Canadians into poverty.

The briefing note credited the 2016 launch of the tax-free Canada Child Benefit with reducing national poverty rates from 14.5 percent to 6.5 percent in 2020. But the note said the escalating cost of groceries bumped the poverty rate up to 7.4 percent in 2021.

The Canada Child Benefit last year paid families up to $7,437 annually per preschooler and $6,275 for school-age minors under 18. Some 3.5 million families with six million children collected the benefit at a yearly cost averaging $25 billion, according to official estimates.

Yet, cost-of-living adjustments to the program simply could not match inflation, the note said.

The poverty report indicated similar sentiments from those surveyed. Those on social assistance say their monthly payment does not cover all of their costs, the report said, noting that the current rate is “far below the cost of living.”

“With rising costs, we heard that even people who are working full-time are struggling to make ends meet,” the report’s authors said. “Wages are failing to keep up with inflation. People who were already in poverty are sliding deeper into it. Those who were not in poverty are at risk of it now.”

The report also noted that the percentage of working-age single people living in poverty remains elevated due to “inadequate” wages.

“Despite working full-time or working multiple jobs, many working-age singles stay in poverty,” the report said. “We also heard that the narrative for single working-age individuals creates a challenge. It often describes them as undeserving of help, with children and seniors having received priority for more targeted supports.”

Food Prices

Approximately 4.8 million people—12.9 percent of Canadians—lived in households experiencing moderate or severe food insecurity in 2021 compared to 4.1 million people or 11.2 percent of Canadians in 2020, the poverty report found.

Female-led single-parent households had the highest rates of food insecurity with 34.1 percent of such families impacted by food prices in 2021.

Statistics Canada figures released Jan. 3 showed that the price for basic food items such as pasta, cereal, and peanut butter rose between Sept. 1 and Nov. 30. Produce was the worst offender for price increases overall with a wide range of fresh and frozen fruits and vegetables going up in price. Staples such as milk, butter, eggs, cheese, and bread also went up as did infant formula and some cuts of meat like ground beef, according to the StatCan report.

Canada’s 2024 Food Price Report, released in December by Agri-Food Analytics Lab at Dalhousie University, predicted that the price of groceries will increase by an average of $701.79 per family of four this year, leaving many families scrambling for ways to economize.

“Our latest research highlights a growing concern among Canadians about rising food prices and their consequent shift in food consumption habits,” Agri-Food Analytics Lab director Sylvain Charlebois said in the report. “From increasing reliance on promotions and loyalty programs to a heightened focus on food waste reduction, Canadians are adapting in diverse ways to manage their food expenses.”

Some families have been forced to turn to food banks to make ends meet. National network Food Banks Canada counted 1,935,911 visits to food banks last March—the latest data available—a 32.1 percent increase from March 2022 and a 78.5 percent jump from March 2019.

A Feed Ontario report last fall said food bank use had “reached a crisis level” in Ontario, rising 38 percent in the 2022-2023 fiscal year. More than 800,000 people in the province used a food bank between April 1, 2022, and March 31, 2023, the highest single-year increase ever reported.

Housing Crisis

Insufficient housing and the soaring price of rent and mortgage rates have also left many Canadians struggling.

The number of renters is growing, the poverty report noted, adding that the cost of buying a home is outpacing household income growth. Renters in particular are more than twice as likely to be in unaffordable housing compared to homeowners.

“Rising rents, interest rates and a lack of affordable housing is putting pressure on people living in poverty,” the report said. “It has also put pressure on those living on middle incomes.”

Average asking rents in Canada saw a record-high as 2023 came to a close, reaching a historic $2,178, according to the latest report from Rentals.ca. This marked an 8.6 percent increase from $2,005 a year ago in December 2022.

According to the “January 2024 Rentals.ca Report,” asking rents in Canada grew by a total of 22 percent over the past two years, translating to an average monthly increase of $390.

The 8.6 percent increase in rents in 2023 followed a 12.1 percent increase in 2022 and a 4.6 percent uptick in 2021. The five-year average annual increase in asking rents stood at 4.9 percent, including the 5.4 percent dip in 2020 due to the impact of the COVID-19 pandemic.

Andrew Chen contributed to this report.